Apple employee embezzled $17 million over seven years using supply chain scams

Cal Jeffrey

Posts: 3,721   +1,171
Staff member
In a nutshell: A former Apple employee pled guilty in federal court to charges of conspiracy to commit fraud and conspiracy to defraud the United States. The crimes involved scams the man ran during his ten-year employment at Apple as a buyer within its supply chain.

Apple hired Dhirendra Prasad in 2008 to work in its Global Service Supply Chain. His primary responsibility was to purchase services and parts for the company from its various authorized vendors.

In 2011, Prasad began accepting kickbacks, falsifying invoices, and stealing components. Prasad enlisted the help of at least two of Apple's vendors to set up and execute the scams. The embezzlement continued through 2018 before Apple caught on and pressed charges. Prasad's hustle resulted in a $17 million loss.

One scheme that Prasad admitted to involved shipping motherboards to a company called CTrends, operated by Don Baker, who pleaded guilty in a separate federal case. Baker would receive the boards and strip them of parts. Prasad would then draw up a purchase order, and Baker would fill it with the harvested components and fraudulent invoices. The two would then split the money.

In another scam, Prasad shipped parts from a Nevada warehouse owned by Apple to Quality Electronics Distributors. This business was another Apple vendor run by co-conspirator Robert Hansen. Like the other scheme, Hansen would repackage the components and send them back to the warehouse with fake invoices, and Prasad would dummy up purchase orders. Hansen also pled guilty in a separate hearing.

In the seven years of defrauding Apple, Prasad had to set up a shell company to hide his phony business dealings that frequently involved hundreds of thousands of dollars. Prasad would funnel payments from Baker and Hansen into the company while they would write the expenses off as tax deductions. The US Justice Department claims Prasad and his confederates defrauded the Internal Revenue Service (IRS) of over $1.8 million.

Sentencing is scheduled for March 14, 2023. Prasad could face up to 20 years in prison for one count of wire and mail fraud against Apple and another five years for a single count of defrauding the IRS.

Permalink to story.

 

VitalyT

Posts: 6,476   +7,346
Prasad's hustle resulted in a $17 million loss.
It took me longer to read this article than it takes Apple to make an extra 17 million. So much efficiency for justice...
 

Adhmuz

Posts: 2,289   +1,116
Amazing it took a company as security conscious and intelligent as Apple 7 years to catch on to this, really the man should get a medal and just pay the IRS back what they are owed.
 

kiwigraeme

Posts: 1,399   +1,040
3 years max in NZ out in half of that.
I always find fines, sentences baffling .
Here in NZ - there are lots of bylaw and court fines that have no seeming consistency or sense
One a innocent error of admission - eg not renewing something in time a large fine.
Yet some willful deliberate act that hurts others a minor fine.

What's most gulling is if it's cheaper for corporates to say profit from unethical behavior and pay token fines
 

Fimbulvetr

Posts: 42   +44
If it were any other company, I'd see a criminal. In this case, I see an entrepreneur, or maybe more of a thief stealing from thieves. ;)
 

Gezzer

Posts: 317   +153
Not condoning what he did, even if it was Apple that he targeted. But what I don't understand is why so many criminals who execute a perfect scam don't quit and move to country with no extradition? A person could easily live a life of luxury on 10 million, hell I've calculated that 2 million would be more than enough for me. 1 million to blow/spend and 50 grand a year to live on for 20 years (I'm currently 60+) or 25 for 40 years if you're younger, with sporadic contract/gig work. It's only criminals that push their luck that are guaranteed to eventually get caught.